So what does the marginal cost of each activity or service look like? To answer this, we need to define that cost. There are three different concepts that I would like to demonstrate: operating cost, capital cost, and marginal cost. Let’s go over each.
The capital cost is the amount of money you spend on a service. The marginal cost is the amount that you spend on it every day. The capital cost is the amount of money you spend on a service. The marginal cost is an aggregate of the other two variables. For instance, a service costs $10 a week. Capital and marginal cost are the costs that the service would take on in the future.
How much money do you spend on the service right now? Well, the marginal cost for food is 5 dollars, the marginal cost for electricity is 6 dollars, and the marginal cost for the internet is about 6 dollars. So that means that if you buy a $20 coffee today, you will be spending $20 more tomorrow. That’s a marginal cost which is equal to the cost of the service multiplied by the number of days it will take you to pay to use your coffee.
So just how many cups of coffee will you be able to buy in these 20 days? It seems like we’re getting close, but we’re not quite there yet. The first major hurdle is figuring out how many cups of coffee each of you will be able to buy. If you’ve got a 40 cup fridge, that’s only 2 days worth of coffee in your cupboard.
The chart above is an estimate of the marginal cost of each cup of coffee that you have. The marginal cost of a single cup of coffee is the cost to you of purchasing the cup of coffee multiplied by the number of days. So if you have a 40 cup fridge, and you want to buy 40 cups of coffee, you need to add 2 days to the number of days that it takes to get 40 cups of coffee.
This is where the cost of coffee is not only dependent on the number of days, but how much of it is wasted (because the coffee gets dumped on the kitchen counter) when you buy it. A 40 cup fridge would be able to support 40 cups of coffee, and even though you might only consume half of the coffee, the other half is all wasted.
This same kind of thing happens in a car, where you add a day to the number of days it takes to get to your destination. If you drive to work and park at the same time instead of picking up your car at the garage, all of the time you had spent driving before the parking is not used to get to the garage, you will be able to put all of the time you put into parking to get you to the garage.
It’s the same thing with a car. If you drive to work and park at the same time instead of picking up your car at the garage, all of the time you spent driving before the parking is not used to get to the garage, you will be able to put all of your time to parking to get you to the garage.
This is how I usually approach parking at the garage.